The Unicorn In The Report

Earnings season presents opportunity for the investor that maintains a level head. Starbucks (NASDAQ:SBUX) recently reported Q2 earnings results on April 27. After earnings, Starbuck’s stock fell about 4%. Investors that failed to understand that Starbucks is a moat a stock, with outstanding margins, free cash flow, and return on invested capital, panicked and sold after earnings. However, if you are like us, you realize the strength of Starbuck’s brand and maintained confidence in your position.

Starbucks stock pulled back following earnings, after the company lowered its full-year guidance, calling for 8-10% top-line growth and EPS of $2.08-2.12. Comparable same-store sales came in at 3%.

We would like to point out the one key metric many investors may not have caught in the earnings report and the significance it holds. We will call this metric “the unicorn in the report.”

Starbucks trialed a new drink: The Unicorn Frappuccino. This drink was made from a creme frappuccino with mango syrup, pink powder, and a sour blue drizzle. As the customer drinks it, the frappuccino changes in both color and flavor.